As a property investor here in Malaysia, I remain pretty optimistic. I think as long as we do not buy with our eyes closed, we should do just fine. 2018 can either be a great year or a recession. I take a longer term view than just 2 years. Reported in NST on 8th June 2016. I consider this a good news for Malaysia amidst the gloom. UOB Bank economist Julia Goh has projected Malaysia’s 2nd half GDP 2016 to be at 4.4 percent. This is better than the first half average at 4 percent. Reasons include mega infrastructure capital spending and the government’s growth stabilisation measures.
She explained that the government has put in place several stablisation measures which could boost the nominal GDP by at least one per cent. This included the three per cent cut in the Employees Provident Fund (EPF) contribution rate, a special RM2,000 tax relief for middle-income tax payers, an increase in minimum wages and civil servant wages, visa waiver for China tourists, as well as a one per cent corporate tax cut. Yes, my dear Malaysians, all these should actually help the economy during the current slowdown.
Her expectations for the Ringgit? “Our outlook for the ringgit remains positive driven by recovering oil prices, the country’s sustained current account surplus and intact fiscal deficit targets.” Goh also said that greater economic diversification has also reduced Malaysia’s dependence on oil revenue with share of oil revenue projected to fall to 14.1 per cent in 2016 compared to 35.8 and 41.3 per cent in 2011 and 2009, respectively. Yes, fellow Malaysians, do understand why former Bank Negara Governor Tan Sri Zeti said that the Ringgit is undervalued and that oil dependence and actual effects on the GDP has been reduced tremendously over the years. Ringgit is definitely undervalued. Happy following.
written on 8 June 2016
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